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RES 1979-63 - 00006741108 RESOLUTION NO. 63 -1979 NOTE RESOLUTION A RESOLUTION GIVING FINAL APPROVAL TO $2,500,000 COMMERCIAL DEVELOPMENT REVENUE BONDS OF 1979: PERLMAN ROCQUE COMPANY BE IT RESOLVED by the City Council of the City of Fridley, Minnesota, as follows: ARTICLE ONE ' DEFINITIONS, LEGAL AUTHORIZATION AND FINDINGS 1 -1. Definitions. The terms used herein, unless the context hereof shall require otherwise shall have the following meanings, and any other terms defined in the Loan Agreement shall have the same meanings when used herein as assigned to them in the Loan Agreement unless the context or use thereof indicates another or different meaning or intent. (1) Act: the Minnesota Municipal Industrial Development Act, Minnesota Statues, Chapter 474, as amended; (2) Architect: Rauenhorst Corportation; (3) Assignment of the Agreement: the agreement to be executed by the City and the Lender assigning the Loan Agreemnet to the Lender; (4) Bond Counsel: the firm of Briggs and Morgan, Professional Association, of St. Paul, Minnesota, and any opinion of Bond Counsel shall be a written opinion signed by such Counsel; (5) Borrower: The Perlman Rocque Company (North), a Minnesota Corporation, its successors and assigns, and any surviving, resulting or transferee entity which may assume its obligations under the Loan Agreement; (6) City: the City of Fridley, Minnesota, its successors and assigns; (7) Construction Loan Agreement: the agreement to be executed by the City, the Borrower, Title, and the Lender, relating to the construction and installation of the Improvements and acquisition of the Land; (8) Improvements: the structures and other improvements, including any tangible personal property, to be constructed or installed by the Borrower on the Land in accordance with the Plans and Specifications; (9) Land: the real estate and any easements and rights described in Exhibit A to the Loan Agreement; (10) Lender: The First National Bank of Saint Paul, in St. Paul, Minnesota, its successors and assigns; (11) Loan Agreement: the agreement to be executed by the City and the Borrower, providing for the issuance of the Note and the loan of the proceeds thereof to the Borrower, including any amendments or supplements thereto made in accordance with its provisions; (12) Mortgage: the Mortgage and Security Agreement to be executed by the Borrower as mortgagor, mortgaging the Project to the Lender to secure , payment of the Note and interest therin; (13) Note: the Commercial Development Revenue Note of 1979 (The Perlman Rocque Company (North) Project), to be issued by the City pursuant to this Resolution and the Loan Agreement; (14) Note Closing: the date upon which the Note is delivered by the City to the Bank and Bank advances the proceeds of the Note to Title; (15) Note Register: the record kept by the City Manager to provide for the registration of transfer of ownership of the Note; 109 RESOLUTION N0. 63 -1979 CONTINUED PAGE 2 (16) Plans and Specifications: the existing plans and specifications for the construction and installation of Improvements on the Land, which have been approved by the Lender, together with such modifications thereof and additions thereto as are reasonably determined by the Borrower to be necessary or desirable for the completion of the Improvements and are approved by the Lender; (17) Principal Balance: so much of the principal sum on the Note as from time to time may have been advanced to or for the benefit of the City and remains unpaid; (18) Project: the Land and Improvements as they may at any time exist; (19) Resolution: this Resolution of the City adopted May 7, 1979, together with any supplement or amendment thereto; and all references in this instrument to designated "Articles," "Sections" and other subdivisions are to the designated Articles, Sections and subdivisions of this instrument as originally executed. The words "herein," "hereof" and "hereunder" and other words of similar import refer to this Resolution as a whole not to any particular Article, Section or subdivision; (20) Title: Title Insurance Company of Minnesota, its successors and assigns. 1 -2. Legal Authorization. The City is a political subdivision of the State of Minnesota and is authorized under the Act to initiate the revenue producing project herein referred to, and to issue and sell the Note for the purpose, in the manner and upon the terms and conditions set forth in the Act and in this Resolution. 1 -3. Findings. The City Council has heretofore determined, and does hereby determine, as follows: (1) The City is authorized by the Act to enter into a Loan Agreement for the public purposes expressed in the Act; (2) The City has made the necessary arrangements with the Borrower for the establishment within the City of a Project consisting of certain property all as more fully described in the Loan Agreement which will be of the character and accomplish the purposes provided by the Act, and the City has by this Resolution authorized the Project and execution of the Loan Agreement, Assignment of Loan Agreement, which documents specify the terms and conditions of the acquisition, installation, construction and financing of the Project; (3) In authorizing the Project the City's purpose is, and in its judgment the effect thereof will be, to promote the public welfare by: the attraction, encouragement and development of economically sound commerce so as to prevent, so far as possible, the emergence of blighted and marginal lands and areas of chronic unemployment; the halting of the movement of talented, educated personnel of all ages to other areas and thus preserving the economic and human resources needed as a base for providing govern- mental services and facilities; the provision of accessible employment opportunities for residents in the area; and the expansion of an adequate tax base to finance the increase in the amount and cost of governmental services, including educational services for the school district serving the community in which the Project is situated; (4) the amount estimated to be necessary to finance the Project Costs, including the costs and estimated costs permitted by Section 474.05 of the Act, will require the issuance of the Note in the principal amount of $2,500,000 as hereinafter provided; (5) it is desirable, feasible and consistent with the objects and purposes of the Act to issue the Note for the purpose of financing the Project; Ito RESOLUTION NO. 63 -1979 CONTINUED PAGE 3 (6) the Note and the interest accruing thereon do not constitute an indebtedness of the City within the meaning of any constitutional or statutory limitation and do not constitute or give rise to a pecuniary liability or a charge against the general credit or taxing powers of the City and neither the full faith and credit nor the taxing powers of the City are pledged for the payment of the Note or interest thereon; and (7) the Note is an industrial development bond within the meaning of Section 103(6) of the Internal Revenue Code and is to be issued within the exemption provided under subparagraph (D) of Section 103(b) (6) of the Code with respect to an issue of $10,000,000 or less; provided that nothing herein shall prevent the City from hereafter qualifying the Note under a different exemption if, and to the extent, such exemption is permitted by law and consistent with the objects and purposes of the Project. 1 -4. Authorization and Ratification of Project. The City has heretofore and does hereby authorize the Borrower, in accordance with the provisions of Section 474.03 (6) of the Act and subject to the terms and conditions set forth in the Construction Loan Agreement, to provide for the acquisition of the Land and the construction and installation of the Improvements included in the Project in accordance with the Plans and Specifications by such means as shall be available to the Borrower and in the manner determined by the Borrower, and without advertisement for bids as may be required for the construction and acquisition of any municipal facilities; and the City hereby ratifies- affirms, and approves all actions heretofore taken by the Borrower consistent with and in anticipation of such authority and in compliance with the Plans and Specifications. ARTICLE TWO NOTE 2.1. Authorized Amount and Form of Note. The Note issued pursuant to this Resolution shall be in substantially the form set forth herein, with such appropriate variations, omissions and insertions as are permitted or required by this Resolution, and in accordance with the further provisions of this Article; and the total principal amount of the Note that may be outstanding hereunder is expressly limited to $2,500,000 unless a deplicate Note is substantially the following form: UNITED STATES OF AMERICA STATE OF MINNESOTA COUNTY OF ANOKA CITY OF FRIDLEY Commercial Development Revenue Note of 1979 (The Perlman Rocque Company (North) Project) $2,500,000 FOR VALUE RECEIVED the City of Fridley, Anoka County, Minnesota, hereby promises to pay to the order of The First National Bank of Saint Paul (the "Payee "), Saint Paul, Minnesota, its successors or registered assigns, from the source and in the manner hereinafter provided, the principal sum of two million five hundred thousand dollars ($2,500,000), so much thereof as may have been advanced to or for the benefit of the City and remains unpaid from time to time (the "Principal Balance "), withinterest thereon at the rate of six and fifty hundredths percent (6.50%) per annum or at such higher rate as hereinafter provided, in any coin or currency which at the time or times of payment is legal tender for the payment of public or private debts in the United States of America, in accordance with the terms herein- after set forth. 1. (a) From and after the date hereof and until January 1, 1980, the City shall pay interest only upon the Principal Balance at the rate of six and fifty hundredths percent (6.50%) per annum. Said interest shall accrue from and after the date of Note Closing and shall be payable on the first day of July and the first day of October, 1979 and the first day of January, 1980. III RESOLUTION NO. 63 -1979 CONTINUED PAGE 4 1. (b) From and after January 1, 1980, the Amortization Date, this Note shall be amortized and paid in two hundred forty (240) equal consecutive monthly installments of eighteen thousand six hundred forty dollars and no /100 $18,640.00 payable on the first day of each month next succeeding the Amortization Date and continuing until the Principal Balance and accrued interest thereon shall have been paid (the "Final Maturity Date "). Payments shall be applied first to interest due on the Principal Balance and there- after to reduction of the Principal Balance. 1. (c) If the interest on this Note should become subject to federal income taxation pursuant to a "Determination of Taxability" as that term is defined in Section 4.09 of the Loan Agreement, then upon receipt by the Borrower from the Payee of notice of the "Determination of Taxability," the interest rate shall be immediately increased to ten and fifty hundredths percent (10.50 %) per annum, and each monthly installment thereafter payable shall be accordingly increased to amortize the remaining Principal Balance by the Final Maturity Date with interest at said increased rate provided that in the alternative at Payee's option as provided in Section 4.09 (5) of the Loan Agreement the Payee may treat such Determination of Taxability as an Event of Default and institute remedial action under Section 6.02 of the Loan Agreement. Whether the interest rate is increased or remedial action is instituted the Payee shall be entitled to receive an amount equal to the aggregate difference between (i) the monthly payments theretofore made to the Lender on this Note between the "Date of Taxability" as that term is defined in the Loan Agreement and the effective date of the rate increase or the date upon which the Principal Balance is paid if Payee elects to treat Determination of Taxability as an Event of Default and (ii) the monthly payments which would have been made during such period if the increased rate had been in effect, all as provided in Section 4.09 of the Loan Agreement hereinafter referred to. 2. Interest shall be computed on the basis of a 30 day month and a 360 day year, but charged for the actual number of days principal is unpaid. 3. If the Payee should not receive on the first day of any month all of the principal and interest then due on the Note, and if the Ctiy should continue to be in arrears through sums due hereunder, the Payee shall be entitled to receive on the sixteenth day of such month a service charge equal to four percent (4.0%) of the delinquent principal and interest and the Payee shall be entitled to receive such service charge on the sixteenth day of each and every month thereafter during which such payment or payments are in arrears. 4. Principal and interest and any penalty or premium due hereunder shall be payable at the principal office of the Lender, or at such other place as the Lender may designate in writing. 5. This Note is issued by the City to provide funds for a Project, as defined in Section 474.02, Subdivision 1(a), Minnesota Statutes, consisting of the acquisition of the Land and construction of a distribution center for food products and restaurant supplies pursuant to a Loan Agreement of even date herewith, between the City and The Perlman Rocque Company (North) (the "Borrower "), a Minnesota corporation, and this Note is further issued pursuant to and in full compliance with the Constitution and laws of the State of Minnesota, particularly Chapter 474, Minnesota Statutes, and pursuant to resolutions of the City Council duly adopted on December 18, 1978 and May 7, 1979 (the "Resolution "). 6. This Note is secured by an assignment of the Loan Agreement by the City to the Payee and a Mortgage and Security Agreement of even date herewith between the Borrower, as Mortgagor, and the Payee as Mortgagee. The disbursement of the proceeds of this Note is subject to the terms and conditions of a Construction Loan Agreement of even date herewith between the Payee, the City, Title Insurance Company of Minnesota and the Borrower. 112 RESOLUTION NO. 63 -1979 (CONTINUED) PAGE 5 7. The Payee may extend the times of payments of interest and /or principal of or any penalty or premium due on this Note, including the date of the Final Maturity Date, without notice to or consent of any party liable hereon and without releasing any such party. However, in no event may the Final Maturity " Date be extended beyond May 1, 2009. 8. This Note may be prepaid at any time, either in whole or in part without penalty, and all such prepayments, if only partial, shall be applied against the Principal Balance and shall not affect the monthly payments due hereunder. 9. This Note is further subject to prepayment, without a premium, in whole or in part, upon the occurrence of certain events of damage, destruction or condemnation to to the Project, or, in whole but not in part, upon the Bor- rower receiving notice from the Payee that the interest on the Note is subject to federal income taxation pursuant to a Determination of Taxability," and exercise by Payee of its option to treat such Determination of Taxability as an Event of Default under the Loan Agreement. 10. The amount of the monthly payments due under paragraph 1 hereof, shall continue until the entire Principal Balance and accrued interest due on this Note have been paid regardless of any partial prepayment made hereunder. 11. As provided in the Resolution and subject to certain limitations set forth therein, this Note is transferable upon the books of the City at the office of the City Clerk, by the Payee in person or be his agent duly authorized in authorized in writing, at the Payee's expense, upon surrender hereof together with a written instrument of transfer satisfactory to the City Clerk, duly executed by the Payee or his duly authorized agent. Upon such transfer, the City Clerk will note the date of registration and the name and address of the new registered Payee in the registration blank appearing below. The City may deem and treat the person in whose name the Note is last registered upon the books of the City, with such registration noted on the Note, as the absolute owner hereof, whether or not overdue, for the purpose of receiving payment of or on account of the Principal Balance, redemption price or interest and for all other purposes, and all such payments so made to the Payee or upon his order ' shall be valid and effective to satisfy and discharge the liability upon the Note to the extent of the sum or sums so paid, and the City shall not be affected by any notice to the contrary. 12. All of the agreements, conditions, covenants, provisions and stipu- lations contained in the Resolution, the Mortgage and Security Agreement, the Loan Agreement and the Construction Loan Agreement are hereby make a part of this Note to the same extent and with the same force and effect as if they were fully set forth herein. 13. This Note and interest thereon and any penalty or premium due hereunder are payable solely from the revenues and proceeds derived from the Loan Agree- ment and the Mortgage and Security Agreement, and do not constitute a debt of the City within the meaning of any constitutional or statutory limitation, are not payable from or a charge upon any funds other than the revenues and proceeds pledged to the payment thereof, and do not give rise to a pecuniary liability of the City or, to the extent permitted by law, of any of its officers, agents or employees, and no holder of this Note shall ever have the right to compel any exercise of the taxing power of the City to pay this Note or the interest thereon, or to enforce payment thereof against any property of the City, and this Note does not constitute a charge, lien or encumbrance, legal or equitable, upon any property of the City, and the agreement of the City to perform or cause the performance of the covenants and other provisions herein referred to shall be subject at all times to the availability of revenues or other funds furnished for such purpose in accordance with the Loan Agreement, sufficient to pay all costs of such performance or the enforcement thereof. 14. It is agreed that time is of the essence of this Note. In the event of failure by the City to pay when due any penalty due hereunderas provided in the Loan Agreement, or if an Event of Default shall occur, as defined in the Mortgage and Security Agreement or the Loan Agreement of even date herewith, then the Payee shall have the right and option to declare all the remaining indebtedness of unpaid principal and accrued interest, evidenced by this Note, immediately due and payable. Failure to exercise such option at any time shall not constitute a waiver of the right to exercise the same at any subsequent time. 113 RESOLUTION NO. 63 -1979 (CONTINUED) PAGE 6 15. The remedies of the Payee, as provided herein and in the Mortgage and Security Agreement, the Loan Agreement and the Construction Loan Agreement, are not exclusive and shall be cumulative and concurrent and may be pursued singly, successively or together, at the sole discretion of the payee, and may be exercised as often as occasion therefor shall occur; and the failure to exercise any such right or remedy shall in no event be construed as a waiver or release thereof. 16. The Payee shall not be deemed, by any act of omission or commission, to have waived any of its rights or remedies hereunder unless such waiver is in writing and signed by Payee and, then only to the extent specifically set forth in the writing. A waiver with reference to one event shall not be construed as continuing or as a bar to or waiver of any right or remedy as to a subsequent event. 17. The Note has been issued without registration under state or other securities laws, pursuant to an exemption for such issuance; and accordingly the Note may not be assigned or transferred in whole or part, nor may a participation interest in the Note be given pursuant to any participation agreement, except in accordance with applicable registration requirements or an applicable exemption from such registration requirements. 18. Whenever any party to this Note is permitted or required to do or accomplish any act or thing hereunder on a specific day and that day falls on a weekend or holiday, the act shall be deemed accomplished in a timely manner if performed on the immediately succeeding business day following such weekend or holiday. IT IS HEREBY CERTIFIED AND RECITED that all conditions, acts and things required to exist, happen and be performed precedent to or in the issuance of this Note do exist, have happened and have been performed in regular and due form as required by law. IN WITNESS WHEREOF, the City has caused this Note to be duly executed in its name by the manual signatures of the Mayor and City Clerk, has caused the corporate seal to be affixed hereto, and has caused this Note to de dated 1M uM i 1979. CITY OF FRIDLEY, MINNESOTA MAYOR PROVISIONS AS TO REGISTRATION The ownership of the unpaid Principal Balance of this Note and the interest accruing theron is registered on the books of the City of Fridley in the name of the holder last noted below. Date of Name and Address Signature of Registration Registered Owner City Manager The First National Bank of Saint Paul 1st National Bank Building 332 Minnesota Street St. Paul, MN 55101 1]4 RESOLUTION NO. 63 -1979 (CONTINUED) PAGE 7 2 -2. The Initial Note. The Note shall be payable at the times and in the manner, shall bear interest at the rate, and shall be subject to such other terms and conditions as are set forth therein. 2 -3. Execution. The Note shall be executed on behalf of the City by the signatures of its Mayor and City Clerk and shall be sealed with the Seal of the City. In case any officer whose signature shall appear on the Note, such signature shall never- theless be valid and sufficient for all purposes, the same as if he had remained in office until delivery. 2 -4. Delivery of Initial Note. Before delivery of the Note there shall be filed in the office of the City Clerk the following items: (1) (A) an executed copy of the Loan Agreement and Assignment of the same; (B) an executed copy of the Mortgage; (C) an executed copy of the Construction Loan Agreement; (2) an opinion of counsel for the Borrower in scope and substance satisfactory to Bond Counsel as to the authority of the Borrower to enter into the transaction and other related matters; (3) the opinion of Bond Counsel as to the validity and tax exempt status of the Note issued pursuant to this Resolution; (4) both Owner's and Mortgagee's policies of Title Insurance issued by Title both in the face amount of $2,500,000 insuring good and marketable title to the Land and the structures thereon in the Borrower subject to a first mortgage in the amount of $2,500,000 in favor of Lender suject only to such encumbrances as have been consented to in writing by Lender; (5) such other documents and opinions as Bond Counsel may reasonably require for purposes of rendering its opinion required in subsection (3) above or that the Lender may require for the closing. Upon delivery of the Note, the Lender shall, on behalf of the City, advance funds for payment of Project Costs to Title, in accordance with the Construction Loan Agreement. 2 -5. Issuance of New Notes. Subject to the provisions of Section 2 -9, the City shall, at the request and expense of the Lender issue Note or notes, in aggregate outstanding Principal Balance equal to that of the Note or notes surrendered, and of like tenor except as to number, principal amount, and the amount of the monthly installments payable thereunder, and registered in the name of the Lender or such transferee as may be designated by the Lender. 2 -6. Registration of Transfer. The City will cause to be kept at the office of the City Clerk a Note Register in which, subject to such reasonable regulations as it may prescribe, the City shall provide for the registration of transfers of ownership of the Note. Said Note shall be transferable upon the Note Register by the Lender in person or by its attorney duly authorized in writing, upon surrender of the Note together with a written instrument of transfer satisfactory to the City Clerk, duly executed by the Lender of other Payee or its duly authorized agent. Upon such transfer the City Clerk shall note the date of registration and the name and address of the new Payee in the Note Register and in the registration blank appearing on the Note. 1 115 RESOLUTION NO. 63 -1979 (CONTINUED) PAGE 8 2 -7. Mutilated Lost or Destroyed Note. In case any Note issued hereunder shall become mutilated or be destroyed or lost, the City shall, if not then prohibited by law, cause to be executed and delivered, a new Note of like outstanding principal amount, number and tenor in exchange and substitution for and upon cancellation of such mutilated Note, or in lieu of and in substitution for such Note destroyed or lost, upon the Lender's paying the reasonable expenses and charges of the City in connection therewith, and in the case of a Note destroyed or lost, the filing with the City of evidence satisfactory to the City that such Note was destroyed or lost, and furnishing the City with indemnity satisfactory to it. If the mutilated, destroyed or lost Note has already matured or been called for redemption in accordance with its terms it shall not be necessary to issue a new Note prior to payment. 2 -8. Ownership of Note. The City may deem and treat the person in whose name the Note is last registered in the Note Register and by notation on the Note whether or not such Note shall be overdue, as the absolute owner of such Note for the purpose or receiving payment of or on account of the Principal Balance, redemption price or interest and for all other purposes whatsoever, and the City shall not be affected by any notice to the contrary. 2 -9. Limitation on Note Transfers. The Note has been issued without registration under state or other securities laws, pursuant to an exemption for such issuance; and accordingly the Note may not be assigned or transferred in whole or part, nor may a participation interest in the Note be given pursuant to any participation agreement, except in accordance with applicable registration requirements or an applicable exemption from such registration requirements. ARTICLE THREE REDEMPTION OF NOTE BEFORE MATURITY 3 -1. Redemption. (1) In the event of (a) damage to or destruction of the Project or condemnation of the Project or any part thereof and (b) if Borrower does not elect to restore the Project pursuant to Sections 2.03 and 2.04 of the Mortgage, the Note shall be subject to prepayment by the City from funds furnished by the Borrower at the time, to the extent and in the manner set forth in Section 5.02 of the Loan Agreement. (2) In the event that the Borrower should receive from the Lender notice that the interest on the Note is subject to federal income taxation pursuant to a "Determination of Taxability," the Note shall be subject to prepayment in whole but not in part as provided in Section 4.09 of the Loan Agreement. (3) The Note may be otherwise prepaid in accordance with the Provisions of the Note. 3 -2. Termination of Interest. Upon deposit of any prepayment with the Lender and the giving of any notice required by law, the principal amounts prepaid shll, after such date, cease to bear interest. ARTICLE FOUR GENERAL COVENANTS 4 -1. Payment of Principal and Interest. The City covenants that it will promptly pay or cause to be paid the principal of and interest on the Note at the place, on the dates and in the manner provided herein and in said Note. The principal and interest are payable solely from and secured by revenues and proceeds derived from the Loan Agreement and the Mortgage which revenues and proceeds are hereby specifically pledged to the payment thereof in the manner and to the extent specified in the Note, the Loan Agreement and the Mortgage and nothing in the Note or in this Resolution shall be considered as assigning, pledging or otherwise encumbering any other funds or assets of the City. 116 RESOLUTION NO. 63 -1979 (CONTINUED) 4 -2. Performance of and Authority for Covenants. PAGE 9 The City covenants that it will faithfully perform at all times any and all covenants, undertakings, stipulations and provisions contained in this Resolution, in the Note executed, authenticated and delivered hereunder and in all proceedings of the City Council pertaining theretu, that it is duly authorized under the Constitution and laws of the State of Minnesota including particularly and without limitation the Act, to issue the Note authorized hereby, pledge the revenues and assign the Loan Agreement in the manner and to the extent set forth in this Resolution, the Note and the Loan Agree- ment and Assignment of Loan Agreement and Consent and Construction Loan Agree- ment; t:at all action on its part for the issuance of the Note and for the execution and delivery thereof has been duly and effectively taken; and that the Note in the hands of the Lender is and will be a valid and enforceable obligation of the City according to the terms thereof. 4 -3. Enforcement and Performance of Covenants. The City agrees to enforce all covenants and obligations of the Borrower under the Loan Agreement and the Construction Loan Agreement, and to perform all covenants and other provisions pertaining to City contained in the Note, the Loan Agreement and the Construction Loan Agreement. 4 -4. Nature of Security. Notwithstanding anything contained in the Note, Mortgage, the Loan Agree- ment or any other document referred to in Section 2 -4 to the contrary, under the provisions of the Act the Note may not be payable from or be a charge upon any funds of the City other than the revenues and proceeds pledged to the payment thereof, nor shall the City be subject to any liability thereon, mor shall the Note otherwise contribute or give rise to a pecuniary liability of the City or, to the extent permitted by law, any of the City's officers, employees and agents. No holder of the Note shall ever have the right to compel any exercise of taxing power of the City to pay the Note or the interest thereon, or to enforce payment thereof against any property of the City; and the Note shall not constitute a debt of the City within the meaning of any ' constitutional or statutory limitation; but nothing in the Act impairs the rights of the Lender to enforce the covenants made for the security thereof as provided in this Resolution, the Loan Agreement, the Mortgage, the Construction Loan Agreement and in the Act, and by authority of the Act the City has made the covenants and agreements herein for the benefit of the Lender; provided that in any event, the agreement of the City to perform or enforce the covenants and other provisions contained in the Note, the Loan Agreement and the Construciton Loan Agreement shall be subject at all times to the availability of revenues under the Loan Agreement sufficient to pay all costs of such performance or the enforcement thereof, and neither the City nor any officer or employee shall be subject to any personal or pecuniary liability thereon. ARTICLE FIVE MISCELLANEOUS 5 -1. Severabili If any provision of this Resolution shall be held or deemed to be or shall, in fact, be inoperative or unenforceable as applied in any particular case in any jurisdiction or jurisdictions or in all jurisdictions or in all cases because it conflicts with any provisions of any constitition or statute or rule or public policy, or for any other reason, such circumstances shall not have the effect of rendering the provision in question inoperative or unen- forceable in any other case or circumstance, or of rendering any other provision or provisions herein contained invalid, inoperative, or unenforceable to any extent whatever. The invalidity of any one or more phrases, sentences, clauses or paragraphs in this Resolution contained sall not affect the remaining portions of this resolution or any part thereof. 5 -2. Authentication of Transcript. The officers of the City are directed to furnish to Bond Counsel certified copies of this Resolution and all documents referred to herein, and affidavits or certificates as to all other matters which are reasonably necessary to evidence to validity of the Note. All such certified copies, certificates and affidavits, including any heretofore furnished, shall constitute recitals of the City as to the correctness of all statements contained therein. RESOLUTION NO. 63 -1979 (CONTINUED) PAGE 10 117 5 -3. Registration of Resolution. The City Clerk is authorized and directed to cause a copy of this Resolution to be filed with the County Auditor of Anoka County, and to obtain from said County Auditor a certificate that the Note as a bond of the City has been duly entered upon his bond register. 5 -4. Election of "Small Issue" Exemption Under the Code. In accordance with the provisions of Section 103(b) (6) of the Code the City hereby elects with respect to the Note authorized by this Resolution the "small issue" exemption for issues of $10,000,000 or less and authorizes the Mayor or City Manager to execute the election statement attached hereto as Exhibit A. The information contained in paragraphs 2, 4, and 5 of said statement has been furnished by the Borrower. 5 -5. Authorization to Execute Agreements. The forms of the proposed Loan Agreement and assignment thereof and consent, Construction Loan Agreement and Mortgage are hereby approved in substantially the form heretofore presented to the City Council; and the Mayor and City Manager are authorized to execute the Loan Agreement, assignment thereof and Construction Loan Agreement in the name of and on behalf of the City and such other documents as Bond Counsel consider appropriate in connection with the issuance of the Note all with such changes, insertions or omissions therein as do not change the substance thereof and as may be approved by the Mayor or City Manager, such approval to be evidenced by the execution of such documents by the Mayor or City Manager. In the event of the absence or disability of the Mayor or City Manager such officers of the City as, in the opinion of the City Attorney, may act in their behalf, and shall without further act or authorization of the City Council do all things and execute all instruments and documents required to be done or executed by such absent or disabled officers with the same force and effect as if executed by such absent or disabled officers. Adopted by the City Council of the City of Fridley this 7th Day of May, 1979. Attest: City Clerk - Marvin Brunsell Mayor, William J Nee EXHIBIT A ELECTION STATEMENT UNDER I. R. C. SEC. 103(b) (6) AND REGULATIONS SECTION 1.103 -10 (b) (2) (vi) In accordance with I.R.C. Sec. 103(b)(6) and the Regulations promulgated thereunder, the City of Fridley, Minnesota hereby elects to have the provisions of Section 103(b)(6)(D) apply to a commercial Development Revenue Note of 1979 (The Perlman Rocque Company (North) Project), in a face amount less than $10,000,000, namely, $2,500,000. 1. The name and address of governmental unit: City of Fridley 6431 Minnesota Avenue N.E. Fridley, Minnesota 55432 2. The name, address and employer identification number of the principal user orusers of such proceeds or facilities: The Perlman Rocque Company (North) Attn: General Manager 711 Vandalia Street St. Paul, Minnesota 55114 its RESOLUTION NO. 63 -1979 (CONTINUED) PAGE 11 Employer Identification No.: 41- 1308387 The Perlman Rocque Company (North) is wholly owned by the Havi Corporation, 16100 West 103rd Street, Lemont, Illinois and its returns are filed on a consolidated basis with those of the Havi Corporation. 3. The date and face amount of the issue: (a) Authorizing Resolution adopted May 7, 1979 authorizing Commercial Development Revenue Note of 1979 (The Perlman Rocque Company (North) Project). (b) Nominal date of issue: May 1, 1979 (c) Face amount: $2,500,000 (d) Proposed date of issuance of Note: On or about May 15, 1979 There are no outstanding issues, the proceeds of which are or will be used primarily with respect to facilities (i) the principal user or users of which will be the same or a related person as those listed in 2 above, and (ii) which are located in the same incorporated municipality within the meaning of Section 103 of the Internal Revenue Code of 1954 as amended. There have been no capital expenditures paid or incurred within three years preceding the date of the issue for which this election is make with respect to facilities described in paragraph 4 except: None City of Fridley By , Its